Oil Prices Remain at Record Highs Due to the Situation in the Strait of Hormuz — Reuters
Global oil prices have stabilized after rising to their highest level in the past week. The market was influenced by uncertainty regarding a possible end to the conflict between the U.S. and Iran, as well as the resumption of shipping through the Strait of Hormuz.
This came after President Donald Trump demanded compensation for damages inflicted on the U.S.
Brent crude futures fell by 10 cents, or 0.11%, to $87.62 per barrel, while U.S. West Texas Intermediate (WTI) crude futures declined by 5 cents, or 0.06%, to $82.08 per barrel.
Both benchmarks rose more than 5% on Monday to their highest levels since July 31, after Trump responded to Iran’s terms for a peace deal with his own demands that Iran pay compensation for those killed in war, attacks, and protests—a move likely to complicate efforts to reopen the Strait of Hormuz.
Later that day, he added that the U.S. controls the strait and has cleared the strategic oil waterway of Iranian mines.
“It appears there is a gulf between the U.S. and Iran regarding what any agreement should actually look like,” said Tim Waterer, chief market analyst at KCM Trade.
Meanwhile, Saudi Aramco has postponed the restart of its 400,000-barrel-per-day refinery in Jizan until August 30 after the Houthis claimed responsibility for two attacks on the facility on Sunday.
“The risk of a blockade of the Strait of Hormuz and the Bab el-Mandeb Strait remains very significant. Even intermittent restrictions or the threat of further incidents are keeping insurance costs high and forcing the use of longer shipping routes... consequently, energy flows are likely to remain constrained in the near term,” said Tim Waterer.
In a note on Monday, analysts at Barclays reported that for the week ending August 7, net exports of crude oil and refined products through the Strait of Hormuz averaged 3 million barrels per day, compared with 4.4 million barrels per day the previous week.
Meanwhile, the National Oil Company (ADNOC) is offering spot crude oil in a tender—the eighth since early June—as the UAE’s state-owned oil company works to reroute oil away from the Strait of Hormuz.
This was reported by Reuters.
Oil prices are falling amid progress in negotiations regarding the Strait of Hormuz — Reuters.
As a reminder, oil prices rose by more than 1.5% during Asian trading, reaching their highest level in over six weeks. The market reacted to attacks by Yemeni Houthis on oil tankers in the Red Sea and a new wave of U.S. strikes against Iran.
Over the past few days, Iran has been secretly moving oil tankers through the Strait of Hormuz even before the United States reinstated its naval blockade of Iranian ports.
